The Windsor Real Estate Market continues to show strong growth during the week of October 17th to October 24th of 2021.
Resilient and growing, but in different ways, is a great way to account for the Windsor Market at this point in the cycle. We are seeing Commercial Real Estate in Windsor SOAR as more investors from around the globe look for higher yields on their investible cash.
Windsor stands to benefit from this trend as mortgage rates climb. Why? When mortgage rates were low, international money was happy to invest in major markets for 2% and 3% net cap rates (after fees, taxes and expenses). Now that interest rates have ticked up 0.2 basis points, that turn higher is forcing international money to look at markets with a higher NET profit margin. If you were happy making 2% net in Toronto and suddenly interest rates have taken 0.2% away so you are down to making just 1.8%, the risk-free rate of return in other products begin to gain some appeal.
If you can move cash to Windsor, a secondary market in Canada, and can stomach the risk in a subpar market for a higher 3.5% NET rate, then the money flows to Windsor. That is precisely what is happening. International money flows into the Windsor Commercial Sub Market have been BRISK.
Additionally, the residential market is feeling no pain with the slight rise in interest rates and the shortage of renovated properties to the market. Residential inflow to the market has seasonally slowed while inventory offerings have increased slightly week over week with 118 homes being listed and 82 homes reported sold.
On the surface, homes are still being brought to the market well under their offer price. The total listing price of the 82 homes sold was $33,896,000 with a finally selling price of $41,415,000. Math will point out there is about a $7,523,000 difference between the 2 and with 82 homes that would equate to an average over-evaluation of $91,743.
Thanks for reading. You can follow me, Brian Price, at Facebook, Instagram, YouTube, and LinkedIn for more great advice from Windsor’s ONLY multi-disciplinary, fiduciary, consultative, full-time REALTOR, my focus is on YOU and YOUR best interests. Feel free to call my office 24/7 at 519-972-1000. I simply ask, “How can I help?”
